Nigeria Beyond Oil: Utilized, Not Used
Nigeria’s relationship with the United States has long been interpreted through a narrow yet oil heavy lens. Crude oil still matters, but in recent years the U.S.–Nigeria partnership has increasingly moved beyond oil exports. The relationship has deepened its focus through counterterrorism cooperation, support for Nigeria’s internal security campaign, and domestic and international signaling that underscores Nigeria’s role as a strategic partner in West Africa.These priorities sit within a rapidly evolving global supply-chain environment, where diversification and geopolitical risk management are no longer optional but essential.
Today, U.S.–Nigeria relations are shaped less by a single commodity and more by strategic and democratic alignment. Particularly in security cooperation, access to critical and strategic minerals, intelligence sharing, and long-term industrials. Washington’s engagement spans counterterrorism cooperation, maritime security in the Gulf of Guinea, and military assistance—particularly as instability across the Sahel, Red Sea disruptions, and great-power competition intensify.
Comparisons of U.S. foreign military strikes under recent administrations show a shift toward more selective, intelligence-driven, and partner-led operations. Nigeria aligns with this model. Instead of direct intervention, the U.S. focuses on capacity-building, logistics support, and regional stability, treating Nigeria not as a battlefield, but as a strategic anchor.
U.S. Strikes: A Shift in Strategy
The chart below compares the number of U.S. foreign military air and drone strikes carried out under the Biden and Trump administrations. In the graphic, the bar to the left represent U.S. air and drone strikes, while the grey bar represents strikes conducted alongside or by coalition partners. It shows a significant difference in scale between the two presidencies, illustrating how many more strikes have occurred under the current administration compared with the previous one’s full term.
Source: Statista: https://www.statista.com/chart/35728/comparison-of-us-foreign-military-strikes-under-biden-and-trump/
Beyond Crude Oil
Oil is no longer the sole—or even primary—driver of U.S. interest. A modern military and industrial base depends on inputs far upstream from fuel.
Platinum & Metals: Platinum is critical for industrial processes, clean energy systems, and advanced manufacturing. Iron ore and manganese support steel, infrastructure, and defense-related production.
Coal & Diamonds: Coal remains important for industrial energy and steelmaking. Diamonds have industrial uses in precision tools and manufacturing, not just jewelry.
Agriculture: Agricultural products and fertilizer inputs support food security and trade, making them strategic assets in a volatile global supply chain.
For a country operating the most technologically advanced military in the world, crude oil alone is insufficient. Modern warfare and industrial power depend on far more than fuel. Precision systems, satellites, aircraft, and secure communications rely on strategic minerals, power stability, and resilient supply chains. Nigeria increasingly fits that equation. For Nigeria, this alignment supports diversification beyond oil, drives investment into infrastructure and extraction capacity, and strengthens its role within global industrial and security supply chains, which would create more durable, long-term economic growth. As for the U.S. approach it reflects a broader recalibration: partnership over extraction. Despite ongoing governance and infrastructure challenges, Nigeria is viewed less as a fragile state and more as a necessary regional counterweight, explaining sustained engagement through political shifts and security setbacks.
Investment Consideration
HS Towers (NYSE: IHS)
IHS Towers is one of the largest independent owners and operators of telecom infrastructure in Africa, with Nigeria as its core market. While not a defense contractor, IHS supports something just as critical to modern U.S. strategic interests: secure communications, data flow, and network resilience. This is the backbone of economic stability, intelligence coordination, and civilian-military interoperability.
Strengths
Strategic infrastructure control: Owns and operates thousands of telecom towers across Nigeria, making it foundational to national connectivity.
Recurring revenue model: Long-term, dollar-linked contracts with major mobile network operators reduce short-term demand volatility.
Alignment with U.S. priorities: Communications infrastructure underpins cybersecurity, intelligence sharing, emergency response, and economic modernization.
Scale advantage: High barriers to entry due to capital intensity, regulatory approvals, and site acquisition complexity.
Weaknesses
Heavy Nigeria exposure: Revenue concentration increases sensitivity to local macro, FX, and regulatory conditions.
High leverage: Debt servicing becomes more challenging in rising-rate or currency-depreciation environments.
Operational cost pressure: Power generation (diesel, grid instability) remains a persistent expense, weighing on margins.
Opportunities
Digital security & resilience: Secure, redundant telecom networks are increasingly viewed as national security assets—not just commercial utilities.
5G & data growth: Rising demand for mobile data, cloud services, and edge computing deepens reliance on tower infrastructure.
Non-oil strategic relevance: Supports U.S. goals of strengthening African partners through connectivity rather than extraction.
Energy transition upside: Shift toward hybrid power (solar + battery) can materially improve margins and ESG positioning.
Threats
Currency risk: Naira depreciation impacts reported earnings and debt metrics.
Policy and regulatory uncertainty: Changes in telecom regulation or taxation could affect cash flow predictability.
Security risks: Physical infrastructure exposure in high-risk regions raises insurance and maintenance costs.
Geopolitical competition: Chinese-backed infrastructure alternatives could pressure pricing or future expansion.
Final Thought
Nigeria’s relationship with the United States has long been viewed through an oil-heavy lens. While crude still matters, the partnership between the two countries is more holistic in function than heavily concentrated in one area. In recent years, U.S.–Nigeria engagement has shifted toward security cooperation, support for Nigeria’s internal stability, and broader strategic alignment in West Africa.
These priorities reflect a global environment where supply-chain resilience, diversification, and geopolitical risk management are essential—not optional. In that context, Nigeria’s value is structural rather than transactional. It is not a short-term beneficiary of U.S. policy, but a country increasingly embedded in how the U.S. manages security, resources, and regional influence over the long term.
Full Disclosure:
All investments involve risk, including the potential loss of principal. This analysis is for informational purposes only and does not constitute investment advice.